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External vulnerabilities and economic integration. Is the Union of South American Nations a promising project ?

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  • Andrea Bonilla

    (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique)

Abstract

This article addresses the reactions of the Union of South American Nations (UNASUR) economies to external shocks. Unlike the existing economic integration projects, the UNASUR was conceived as a political alliance. Because the recent euro debt crisis con rmed the importance of political agreement for economic integration, the South American plan is likely to be promising. However, economic and political aspects must go hand in hand for an integration project to succeed. Thus, assessing the UNASUR from an economic perspective is essential. Using a structural vector autoregression (SVAR) approach, this paper measures the impact of three external shocks (monetary, commercial and nancial) in the real, monetary and fi scal economic sector of seven UNASUR economies, Argentina, Bolivia, Brazil, Chile, Colombia, Peru and Venezuela, and detects for co-movement paths. The results reveal a non-negligible current synchronization level across the studied economies, con rm their high external vulnerability and identify mutual weaknesses to overcome.

Suggested Citation

  • Andrea Bonilla, 2014. "External vulnerabilities and economic integration. Is the Union of South American Nations a promising project ?," Working Papers halshs-00945044, HAL.
  • Handle: RePEc:hal:wpaper:halshs-00945044 Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00945044
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    Cited by:

    1. Andrea Bonilla, 2014. "An Examination of the Convergence in the Output of South American Countries: The Influence of the Region's Integration Projects," Working Papers halshs-01069353, HAL.
    2. Andrea Bonilla Bolanos, 2014. "An Examination of the Convergence in the Output of South American Countries: The Influence of the Region’s Integration Projects," Working Papers 1424, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    3. repec:rjr:romjef:v::y:2017:i:3:p:130-149 is not listed on IDEAS

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    Keywords

    Economic integration; South America; Structural VAR; UNASUR;

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